While California’s poor, elderly and children suffer the consequences of the new state budget, Arnold’s friends
at the San Francisco Chronicle
are going for the kill. Yesterday’s front-page story about the state’s “long spending spree” was so biased and misleading that it could have been written by the right-wing Howard Jarvis Taxpayer’s Association. It’s no surprise that a state that grew by 7 million people from 1990 to 2008 would spend more money than it did 20 years ago, and even fluctuations in per capita spending don’t tell the whole story. The Chronicle
did not mention state funding for the UC system has dropped 40% since 1990, California is now 47th in the nation in K-12 per-pupil spending and we are the only state kicking uninsured children off SCHIP rolls – and wait-listing thousands more. Rather than admit the state has a revenue problem, the Chronicle
would rather make readers believe we have a spending problem – and that the rich pay too many taxes. For liberal San Francisco’s paper of record, that’s a colossal embarrassment.
Wyatt Buchanan’s article
made it sound like our current budget crisis is a good thing – because state legislators who poured “increasing amounts of money into state services” have finally learned the party is over. State budget cuts are inevitable, is the conclusion, because of the phenomenal increase in state spending over the past twenty years. And to illustrate the point, the Chronicle
produces a chart to show the increase in state spending.
Of course, it’s also true California went from 29.7 million people in 1990 to 37 million today – so how is it “news” that the state spends more money? The Chronicle
pretends to address this glaring omission with a chart that tracks “per capita” spending – but such claims of a dramatic spending increase are weak. After a steady decline, the state hit a low of per capita spending in 1993 – followed by a slow and incremental rise until 2000. Per capita spending actually went down
every year until 2003, when it rebounded in the Schwarzenegger Era to a high in 2007. In the past two years, the state has massively cut spending every year.
But even if the Chronicle
proved an increase in per capita spending, “state spending” is not a very helpful statistic – because it says nothing about how the state spent its money.
reports that we have more welfare recipients than any other state, without mentioning that California has (a) the highest population in the country, (b) the highest cost of living, (c) one of the highest unemployment rates, and (d) probably the widest gap between rich and poor. Without offering any proof, the article then makes the dubious claim that our “generous social safety net” has lured poor people to come to California.
But let’s talk about the real
reasons why people move to California. I came here 13 years ago from Illinois to attend UC Berkeley. Since 1990, despite the state’s “long spending spree” that the Chronicle
objects to, state funding for the UC system has declined
by 40%. Ever since I graduated in 2000, undergraduate student fees have doubled
. Going to Boalt Law School is now as expensive as a private school.
The state has a spending
problem? How about the fact that California is 47th in the nation
in per-pupil funding for K-12 education, despite a constitutional mandate that we spend 40% of the General Fund on schools? In 2007 (the “high point” of state spending, according to the Chronicle
), we were 34th in the nation
– after a steady decline in school funding over the past thirty years.
Try telling kids who don’t have health insurance that the state’s spending increased too much in the past 20 years. Schwarzenegger’s $144 million cut to Healthy Families will mean
443,000 children enrolled in the program this year will get kicked off – and another 335,000 will be put on a waiting list. Healthy Families is the state program that implements the federal SCHIP
in California, designed to extend health insurance for children of the working poor. Now, California is the only state to put SCHIP-eligible children on a waiting list – because we “can’t afford” to cover them.
So why did
state spending rise in the past 20 years? Not, as the Chronicle
implies, because liberal legislators were eager to throw money at social programs. If there’s any culprit, it is the state prison population
– which grew by 500% from 1982 to 2000. Due to right-wing “law and order” policies that the voters passed (such as Three Strikes), the state has been obligated to spend a larger part of its budget on locking people up – which costs money.
California has a revenue problem – far more than it has a spending problem. Starting on his first day of office in 2003, Governor Schwarzenegger set off a chain of events that drove the state to bankruptcy
. He slashed the state vehicle license fee that cost us $6 billion a year in lost revenue. With the Republican minority in the state legislature refusing to ever raise taxes at all, Arnold made the problem worse year after year – by borrowing money that compounded our debt. Whoever becomes the next Governor will inherit a colossal mess, a fiscal disaster that would not have happened if we still had the vehicle license fee.
When the Chronicle
finally acknowledges a revenue problem near the end of the article, they say it’s because too much comes from “wealthy taxpayers.” A large portion of the state budget depends on income tax revenue, which fluctuates with the economy. When we are in a recession, the state gets less money – because people are making less money.
But it’s not like we’ve never had a recession. Under Republican Governors Pete Wilson and Ronald Reagan, income tax revenue took a hit during hard times – so we temporarily raised the income bracket for the wealthy. Schwarzenegger, however, refuses to do this.
We could also pass an oil severance tax – charging oil companies 10% of their profits for the privilege of drilling for oil in California. We are the third-largest oil producing state in the country, and yet the only one that does not have an oil severance tax. Texas has a 15% oil tax, and Alaska – under Governor Sarah Palin – raised theirs to 25%. But again, Governor Schwarzenegger opposes it – putting Arnold to the right of Sarah Palin on this.
Does the state depend too much
on income tax revenue? Only because we don’t get enough money from property taxes. Proposition 13 froze property taxes to 1% of whatever the value was at time of purchase, with only a 2% increase each year. Prop 13 does not distinguish
between residential and commercial property, so the real beneficiaries are corporations that own office buildings. Unfortunately, we’re stuck with this system – until the voters amend Prop 13.
But if income taxes are too volatile because revenues fluctuate with the economy, what about the sales tax? Conservatives always argue that tax increases “hurt” the economy, and the only place where that’s true is if you raise the sales tax. Sales tax increases deter consumers from buying goods, and – moreover – hurt the poor more than anyone else. If we want a stable and reliable source of revenue, raising the sales tax would be a disaster.
When the San Francisco Chronicle
regurgitates right-wing talking points in a front-page “news” story about state politics, it has the potential to do far more damage than if it were a local issue. Because in Sacramento, most legislators and opinion leaders presume that the “paper of record” of California’s most liberal city must be a progressive publication. So when the Chronicle
starts acting more like the Orange County Register
(or a Howard Jarvis Newsletter), it can inflict serious damage on state budget politics … which is wholly unacceptable.